TMI Blog1956 (8) TMI 36X X X X Extracts X X X X X X X X Extracts X X X X ..... t as a transferee company it was liable to pay the tax which the transferor company was liable to pay. The petitioners thereupon came here under the Constitution for a writ contending that the demand for tax made by the Taxing Authority was not justified by law. Now, it appears that after the petition was filed, which was on the 18th of April, 1956, the notices originally served by the Taxing Authority upon the petitioners have been withdrawn and fresh notices have been served. But the Advocate-General agreed that we should give our decision on the basis of the new notices. As a matter of fact, there is no difference in principle whether the notices were issued earlier or later and except for a slight difference in the amount, the positio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the first question that we have to consider is whether any liability accrued to the petitioners which was saved by section 48(2) of the Act of 1953. The material date for the purpose of this argument is the date of transfer, which is the 4th of May, 1954, and it will be noticed that this transfer took place after the Act of 1946 had been repealed. Therefore when the petitioners took the transfer of the business from the transferor company, could it be said that they took the transfer with a liability to pay the tax payable by the transferor company? As we have already pointed out, the liability created by section 18 is an artificial liability and we must be satisfied that at the date of the transfer there was any liability upon the transfer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion states, "when the ownership of the business of a dealer liable to pay the tax is entirely transferred." Therefore the transfer contemplated by this section is the transfer of a business which is liable to pay the tax; and "tax" is defined by section 2(18) as "the sales tax, general sales tax, a purchase tax or outside goods purchase tax payable under this Act", i.e., the Act of 1953. It is clear that the business which was transferred to the petitioners on the 4th of May, 1954, was not liable to pay any tax under the Act of 1953. Its liability to pay tax was only under the Act of 1946. Therefore section 26 has no operation. The Advocate-General finds himself on the horns of this dilemma. If he relies on the Sales Tax Act of 1946, then t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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